Customer Satisfaction

Meaning, Definition • Gratification, pleasure, fulfilment of desire.• A feeling that emanates from fulfilment of

needs and wants.• Evaluated on the basis of what is received

against what was expected.• Satisfaction = Things not going wrong• Differs from person to person.• Direct outcome of product/service

performance.

Customer Satisfaction• Understanding the satisfaction of buyers

in reference to a business transaction is a customer satisfaction.

• Howard and Seth (1969): Customer Satisfaction– “the buyer’s cognitive state of being

adequately or inadequately rewarded for the sacrifice he/she has undergone”.

Customer Satisfaction

• Day and Landon (1977):– Satisfaction is important to the

individual consumer because it reflects a positive outcome from the outlay of scarce resources and/or the fulfilment of unmet needs”.

Customer Satisfaction

• Churchill and Suprenant (1982):An outcome of purchase and use resulting from the buyer’s comparison of the rewards and costs of the purchase relative to anticipated consequences”.

• Two forms of satisfaction – transaction specific, satisfaction overall.

Significance of CS

Components of Customer Satisfaction

• Quality values influencing satisfaction behaviour:– Quality– Value efficiency– Timeliness– Access– Self-management– Environment– Team work– Commitment– innovation

CS Models

1. The expectation disconfirmation model

2. The perceived performance model3. Norms model4. Multiple process model5. Attribution model6. Affective model7. Equity model

CS Models

1. The expectation disconfirmation modelConsumer compares pre-consumption expectations with post-consumption experiences, thus forming an attitude of satisfaction or dissatisfaction towards the product/service.

CS Models

2. The perceived performance modelThe model holds in the situations where a product/service performance is so well that the consumer’s expectations are shadowed by the consumer’s post-consumption reaction to the product/service.

CS Models

3. Norms modelconsumer compares perceived performance with some standard for performance which is not a predictive expectation. The consumer uses what should happen as the comparison standard.

CS Models

4. Multiple process modelConsumers use more than one standard of comparison in forming a confirmation/disconfirmation judgement about an experience with a product/service.

CS Models

5. Attribution modelConsumers use three factors to determine the attribution’s effect on satisfaction. These are:

• Locus of Causality• Stability• Controllability

CS Models• Locus of Causality

– Can be external i.e. service provider gets the credit or blame.

– Can be internal i.e. consumer is responsible for product/service performance.

CS Models• Stability

– Stable causes would tend to have more impact on satisfaction because consumers tend to be more absolving of product/service failures that appear to be rare events.

CS Models• Controllability

– A poor consumption experience may mean that consumers will be unsatisfied with the product/service provider if the consumer believes that the provider can control the cause of dissatisfaction.

CS Models

6. Affective modelThis model moves beyond rational processes. Here emotion, liking and move have influence over feeling of satisfaction or dissatisfaction emerging out of consumption experience.

CS Models7. Equity model

This model emphasises the consumer’s experience about fair treatment in the consumption process.The model focuses on the amount of return for effort made by the consumers or the concept of social comparison (the perceived relative level of product/service performance that other consumers experience).

Categories of fairness:• Procedural fairness• Interactional fairness• Distributional fairness.

Rationale of Customer Satisfaction1. CS building customer loyalty2. CS helping in customer retention3. CS strengthening customer’s

repurchase intentions4. CS leading to superior business

performance

Service Quality and CS

• Service quality school• Satisfaction school

Service quality school

• Satisfaction an antecedent of service quality

• Satisfaction with a number of individual transactions “decays” into an overall attitude towards service quality.

Satisfaction school

• Assessments of service quality lead to an overall attitude towards the service that is called satisfaction.

• Strong link between customer satisfaction and customer retention.

• customer’s perception of service and quality of pdt will determine the success of the pdt or service in the market.

• If the experience of the service greatly exceeds the expectations clients had of the service, then satisfaction will be high, and vice-versa.

• Perception of service delivery are measured separately from customer expectations and the gap between the two provides a measure of service quality.

Measuring CS

• Expectation & CS• The profit chain model

– Employee perception and business performance

Measuring CS• Service expectation model–Comparing customer’s actual perception

with their expectations.– In the first case ‘quality’ is considered and

in the second case cs is considered.–Compare evaluations of the user with his

satisfaction connected to an ideal product/service.

–Sometimes expectations are subjective or they can be suggested by the provider.

Measuring CS• Variability in the Service Process model

– Heterogeneous customers– Lack of rigorous policies and processes– High employee turnover– Nature of customisation